Deals in Asia may take time but the potential rewards are huge, writes Siobhán Creaton, Finance Correspondent, in Singapore.

Hundreds of entrepreneurs from all corners of the globe joined the Chinese New Year celebrations in Singapore this week in the hope that the Year of the Rooster will indeed signify a time for hard work, innovation and the start of major transformation.

These busy trailblazers have taken the time to travel to this prosperous island to attend Ernst & Young's inaugural Entrepreneur of the Year Summit. The delegates are past winners of this 20-year-old award and are delighted to be meeting in Asia, the region they believe presents most opportunities for their businesses.

Opening the summit, Ernst & Young chairman and chief executive Mr Jim Turley said that a survey of the delegates revealed that almost all had big plans in terms of expanding into new world markets, and particularly China, over the coming years.

"These results should come as no surprise," Mr Turley said. "The rise of Asia, particularly China and India, but also Singapore and countries throughout the region, will likely reshape the world economy in coming decades. In these and so many other areas, it is the entrepreneurs who will define the paths we take working together as a global community."

He is confident that, in their quest to capture a slice of Asia's burgeoning economies, these businessmen and women can also make a key contribution in the rebuilding of the economies devastated by the tsunami.

The theme of the conference is Access Asia, with speakers highlighting the potential risks and rewards for firms trading here.

Singapore's Senior Minister, Mr Goh Chok Tang, said that Asian enterprises, rather than foreign multinational corporations, would become a significant force powering the region's growth. The Minister said that foreign investment would continue to play an important role in most Asian economies but that each country would need to adopt new strategies to take their economies to the next level. This, he suggested, would largely be harnessed from local entrepreneurs and innovation.

International investors would benefit from the many structural reforms being undertaken by most Asian governments, he said. They were becoming more enterprise friendly and are working to standardise market practices to facilitate cross-border fund-raising and investment.

In terms of the longer-term opportunities, he noted that domestic demand was set to remain robust in the years ahead as people in the region got richer.

China's middle class is expected to surge by 10 times over the next decade and India's will increase 14-fold.

Mr Kuo-Chuan Kung, managing director of the Carlyle Group's Asia operations, explained that investors in Asia must be flexible and patient.

"Quality not quantity should be the watch word of any potential investor in the region. The Asian markets are not yet as sophisticated as those in Europe and deal makers have to appreciate that closing the transaction will not always come easily," he told delegates.

Mr Kung said that means being prepared to get close to your potential client, identifying problems up front, being creative and flexible and being ready for the long haul.

"Asian deals take twice or three times the effort and time compared to the US or Europe. When all is said and done though, the potential upside rewards are massive."

He pointed to enormous investment opportunities in all sectors of the Asian economy, ranging from industrial, consumer, telecom, automotive, to financial services, healthcare, infrastructure, and oil and gas.

Leading global research consultant and former Merrill Lynch chief economist Donald Straszheim said that every industry in every country had been fundamentally affected by China's business model.

"When you look at how the world's economies are shaping up and preparing themselves to do business in the medium to long term, there is no question that China is the global engine of growth and an agent of change. As such, every company in the world should recognise China both as an opportunity and a threat for their own business development."

He said the message to business leaders, entrepreneurs and politicians was simple: "Ignore China at your peril."

In 2005, China's economy is set to grow by 8-9 per cent and is attracting the world's largest foreign direct investment inflows, which brings capital, technology and talent.

Mr Straszheim said multinationals were China's key dynamic and that it was the best market for mergers and acquisitions in world history. What was needed was what he termed "institutional capital", such as legal and regulatory frameworks, which would help create more trust and openness. The resurgence of China as a major influence on the world economy had altered business dynamics throughout the world, partly due to its ability to show strength across a number of industries, especially manufacturing.

"If we take automotive production, China is set to experience a boom and this means that it will soon challenge the traditional automotive giants of the US and Japan," Mr Straszheim said.

An examination of the wider manufacturing sectors shows there is a continued boom in the low- and high-tech sectors as well. "When it comes to manufacturing, China has covered all the bases."

But it also faced problems. China's banking system was its Achilles' heel and posed meaningful risks, he said. The authorities had yet to tackle this issue head on and, while they were moving to more transparency and better corporate governance systems, these were not fully up and running.

Mr George Yip, professor of strategic and international management from the London Business School, told would-be investors in the region to be aware of the diversity in the way business was conducted in each economy.

Prof Yip suggested that investors should abide by some basic rules and be willing to adapt their products to a local market without losing sight of their original competitive strengths. They must also not compromise on quality.

Unilever and GlaxoSmithKline were good examples of this, he said. "Unilever has been flexible enough to source supplies locally and to adjust their manufacturing processes to keep costs down in India whilst GlaxoSmithKline position Horlicks, which is known as a sleep aid in the UK, as a nutritional energy drink in southeast Asia."

Investors should be aware of the importance of family, which was key to Asian business.

"Family controlled firms exist for things beyond making a profit - they are also there to supply employment and to uphold the family's prestige and honour," he stressed.

The current and former winners of the Entrepreneur of the Year award in Ireland are among the delegates and, as well as networking, some are managing their own business interests in Asia in between conference sessions. Mr Liam Shanahan, of Shanahan Engineering, is a regular visitor to Asia, where his company is involved in projects in China, India, Indonesia, Vietnam and Korea.

The 500 entrepreneurs attending this conference are convinced that Asia is a hotbed for growth, investment and opportunities, with China and India in the driving seat.